Gujarat Gas Limited witnessed a 6 percent decline in its shares, falling to Rs 545 during morning trading on February 16. This drop came after several brokerage firms turned pessimistic about the company’s prospects following a significant 40 percent slump in net profit for the December quarter.
In Q3, the company reported a consolidated net profit of Rs 221 crore, down from Rs 371 crore in the previous year. However, its revenue from operations saw a modest increase of around 7 percent to Rs 4,084 crore from Rs 3,821 crore year-on-year.
As of 10:34 am, the shares were trading 5.60% lower at ₹548.30.
Global brokerage firm Jefferies has given an ‘underperform’ rating on the stock with a price target of Rs 470, suggesting an 18 percent downside from the last closing price. According to analysts, volume losses in Gujarat’s Morbi region and the current pricing strategy hint at margin defense rather than regaining lost market share in Morbi.
Jefferies also highlighted that while the earnings outlook appears strong for margin expansion, the volume growth guidance for FY25 poses a concern.
